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Terry v. WSA, LLC

United States District Court, D. Colorado

December 29, 2014

WSA, LLC, Defendant.


PHILIP A. BRIMMER, District Judge.

This matter comes before the Court on plaintiff's Motion for Default Judgment. [Docket No. 9]. The Court has jurisdiction pursuant to 15 U.S.C. § 1692k(d) and 28 U.S.C. § 1337.


Because of the Clerk of Court's entry of default, Docket No. 8, the allegations in plaintiff's complaint, Docket No. 1, are deemed admitted. Olcott v. Del. Flood Co., 327 F.3d 1115, 1125 (10th Cir. 2003). Sometime before February 2014, plaintiff incurred a financial obligation that was primarily for personal, family, or household purposes. Docket No. 1 at 3, ¶ 8. The debt was later transferred to defendant for the purposes of collection. Id. at 4, ¶ 9. In about November 2013, defendant left plaintiff a voicemail concerning plaintiff's debt. Id. ¶ 12. In that call, defendant did not inform plaintiff that defendant was a debt collector calling for the purposes of attempting to collect on a debt, and that any information obtained would be used for that purpose, but rather informed plaintiff that defendant would file criminal charges if she did not return the phone call. Id. On another occasion in late November 2013, defendant again called plaintiff and spoke with plaintiff on the phone. Id. In that conversation, defendant told plaintiff that it intended to have a warrant issued for plaintiff's arrest and that plaintiff's driver's license would be suspended if she did not pay her debt. Id. On another occasion (date unspecified), defendant informed plaintiff that her driver's license would be suspended the following day. Id. According to plaintiff, defendant knew that it could not initiate criminal charges against plaintiff or act to suspend plaintiff's driver's license at the time it made these representations. Id.

Plaintiff brings a claim for relief for violation of the Fair Debt Collection Practices Act ("FDCPA"), 15 U.S.C. § 1692 et seq. Though served with the complaint and summons, defendant did not answer or otherwise respond to plaintiff's complaint. Accordingly, the Clerk of Court entered default on March 3, 2014. Docket No. 8.


A. Default Judgment

In order to obtain a judgment by default, a party must follow the two-step process described in Fed.R.Civ.P. 55. First, the party must seek an entry of default from the Clerk of the Court under Rule 55(a). Second, after default has been entered by the Clerk, the party must seek judgment under the strictures of Rule 55(b). See Williams v. Smithson, 1995 WL 365988, at *1 (10th Cir. June 20, 1995) (citing Meehan v. Snow, 652 F.2d 274, 276 (2d Cir. 1981)).

The decision to enter default judgment is "committed to the district court's sound discretion." Olcott, 327 F.3d at 1124 (citation omitted). In exercising that discretion, the Court considers that "[s]trong policies favor resolution of disputes on their merits." Ruplinger v. Rains, 946 F.2d 731, 732 (10th Cir. 1991) (quotation and citations omitted). "The default judgment must normally be viewed as available only when the adversary process has been halted because of an essentially unresponsive party." Id. It serves to protect plaintiffs against "interminable delay and continued uncertainty as to his rights." Id. at 733. When "ruling on a motion for default judgment, the court may rely on detailed affidavits or documentary evidence to determine the appropriate sum for the default judgment." Seme v. E&H Prof'l Sec. Co., Inc., No. 08-cv-01569-RPM-KMT, 2010 WL 1553786, at *11 (D. Colo. Mar. 19, 2010).

A party may not simply sit out the litigation without consequence. See Cessna Fin. Corp. v. Bielenberg Masonry Contracting, Inc., 715 F.2d 1442, 1444-45 (10th Cir. 1983) ("[A] workable system of justice requires that litigants not be free to appear at their pleasure. We therefore must hold parties and their attorneys to a reasonably high standard of diligence in observing the courts' rules of procedure. The threat of judgment by default serves as an incentive to meet this standard"). One such consequence is that, upon the entry of default against a defendant, the well-pleaded allegations in the complaint are deemed admitted. See Charles Wright, Arthur Miller & Mary Kane, Fed. Prac. & Proc. § 2688 (3d ed. 2010). "Even after default, however, it remains for the court to consider whether the unchallenged facts constitute a legitimate cause of action, since a party in default does not admit mere conclusions of law." Id. at 63. A court need not accept conclusory allegations. Moffett v. Halliburton Energy Servs., Inc. 291 F.3d 1227, 1232 (10th Cir. 2002). Although "[s]pecific facts are not necessary" in order to state a claim, Erickson v. Pardus, 551 U.S. 89, 93 (2007) (per curiam) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007)), the well-pleaded facts must "permit the court to infer more than the mere possibility of misconduct." Ashcroft v. Iqbal, 556 U.S. 662, 679 (2009) (internal quotation and alteration marks omitted). Thus, even though modern rules of pleading are somewhat forgiving, "a complaint still must contain either direct or inferential allegations respecting all the material elements necessary to sustain a recovery under some viable legal theory." Bryson v. Gonzales, 534 F.3d 1282, 1286 (10th Cir. 2008) (quotation and citation omitted).

While the FDCPA forbids a variety of conduct,

The substantive heart of the FDCPA lies in three broad prohibitions. First, a debt collector may not engage in any conduct the natural consequence of which is to harass, oppress, or abuse any person in connection with the collection of a debt.' § 1692d. Second, a debt collector may not use any false, deceptive, or misleading representation or means in connection with the collection of any debt.' § 1692e. Third, a debt collector may not use unfair or unconscionable means to collect or attempt to collect any debt.' § 1692f.

Johnson v. Riddle, 305 F.3d 1107, 1117 (10th Cir. 2002). To establish a violation of the FDCPA, plaintiff must show that (1) she is a "consumer" within the meaning of 15 U.S.C. § 1692a(3), [1] (2) her debt arises out of a transaction entered into primarily for personal, family, or household purposes, 15 U.S.C. § 1692a(5), [2] (3) defendant is a "debt collector" within the meaning of 15 U.S.C. § 1692a(6), and (4) defendant, through its acts or omissions, violated a provision of the FDCPA. See Nikkel v. Wakefield & Assoc., Inc., No. 10-cv-02411-PAB-CBS, 2012 WL 5571058 at *10 (D. Colo. Nov. 15, 2012).

The Court finds that the complaint, deemed admitted for the purposes of this motion, sufficiently alleges a violation of the FDCPA. Plaintiff alleges that she is a consumer who incurred a debt for personal, family or household purposes, Docket No. 1 at 3, ¶ 8, and that defendant is a "debt collector" as defined by the FDCPA. Id. at 2, ¶ 4. Moreover, plaintiff's allegations support a finding that defendant used tactics intended to harass plaintiff via threatening criminal charges in violation of 15 U.S.C. § 1692d, threatened to take action that cannot legally be taken in violation of 15 U.S.C. §§ 1692e(5) and (10), and used unfair or unconscionable methods to collect on plaintiff's ...

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